Question: 2 W S X X command Questio (14 points) United Airlines is considering adding a new hub operation in Blue Lagoon. The finance group at
2 W S X X command Questio (14 points) United Airlines is considering adding a new hub operation in Blue Lagoon. The finance group at UAL has gathered the following data. They have hired you as a Finance consultant to help them determine their cost of capital . Current stock sells at $30 per share with 30 million shares outstanding Debt of $1.8 billion was issued with a 4% coupon two years ago, and is now trading at 102 UAL pays an annual dividend of $2.40 this year, growing at 3% per year The current risk free rate is 2%, UAL's Beta is 1.5, the market return is 8% UAL pays a corporate tax rate of 21% What debt and equity weights will United use to calculate WACC What is United's cost of deb e. What is United's cost of common equity? What is United's WACC ( * 4 5 6 m. E D C R F V T G B Y H 7 U J 8 M 1 K 9 0 3 L Y T option ( 1 RHIN
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